Don’t Forget Benefits When Considering the Cost of New Employees

Catching up on my podcast file on the way home from dropping children off at school, I listened to RI House Minority Leader Patricia Morgan talking to Tara Granahan on WPRO last Wednesday. Among various topics, they discussed my estimate of net new hires under the Raimondo Administration, emphasizing the $30 million cost in salaries.

Combining that with Monique’s post earlier about the the possibility of 100 new hires in the Raimondo budget for next year makes clear the importance of a reminder: Employees don’t just get salaries; they get benefits, too.

For an ongoing project, I’ve estimated that state workers’ benefits are, on average, 72% of their salaries. So, if we want to know the cost to the state of new hires in Governor Raimondo’s first two budget years, we would have to add to the $30,639,475 in new salaries another $21,953,184 in benefits.

If you don’t have a calculator handy, that’s a total of $52,592,659.

For some perspective, according to WPRI’s Ted Nesi, the final cost to taxpayers of the 38 Studios debacle was a one-time tab of $38.64 million. That’s much less than the $52.59 million in annual employee costs from the state government’s expansion of its workforce over the past two years alone.